The number of IPv4 transactions and volume of IP addresses flowing to and from organizations in the ARIN region in the last 6 months put 2018 on track to be the most active year in the history of the IPv4 market.

Nearly 25 million numbers were transferred in the first half of this year, more than doubling the volume of numbers transferred by this time last year and continuing the level of market activity in the last half of 2017 when just over 28 million numbers were transferred. The growth in the number of transactions compared to last year is not nearly as dramatic but continues the upward trend we've seen year after year.

The high volumes of the last 12 months are the result of more large block supply entering the market. In fact, over 85% of IPv4 addresses traded were the result of just a dozen very large block transactions (>1M addresses). As prices rise (see below), we anticipate that supply will continue to enter the market over the next 12 months and meet the current high demand.

The inter-RIR market, meanwhile, has recovered somewhat since last year. In our 2017 State of the IPv4 Market Report, we noted that the lackluster performance of the inter-RIR market was mostly attributable to the absence of any large block transactions. Alibaba's purchase of over 5 million IPv4 addresses in April has changed the landscape. Already more addresses have transferred in the inter-RIR market in 2018 than in any other year.

Mid-Size Blocks Emerge

The /24 block (256 addresses) continues to dominate, comprising more than 25% of all blocks transferred within and out of the ARIN market. The more interesting development is the emerging prevalence of the /17 (32,768 addresses) and /18 (16,384 addresses) as large block buyers are more willing to accept a collection of smaller non-contiguous ranges from large block sellers.

In 2016, only 7% of the /17 and /18 blocks that transferred to or from organizations in the ARIN were sold as part of a large block transaction. In 2017, this number rose to 34%. During the first half of 2018, nearly the same number of /17 and /18 blocks have sold as during all of 2017, and over 60% of those blocks were sold as part of large block transactions. In fact, for the first time, the /16 block (65,536 addresses), which has reigned as the most popular of the mid-large block sizes traded, is on the verge of being edged out by the /18.

Block Prices Continue to Rise

At the beginning of the year, small block pricing (< 4K numbers) was in the range of $15- $16, mid-sized blocks (65K – 135K numbers) were being priced at $13-$15 per number and large blocks (<1M) were around $15. As we head into the last half of 2018, small blocks are selling for just over $18/number, mid-blocks are in the $15-$18/number range, and large blocks have surpassed the $20/number threshold. Competition among large block buyers is driving up market prices in general. Until this demand is met, pricing should continue to escalate.

IPv6 Deployment Plods Along

Global adoption of native IPv6 is progressing at an unhurried pace. Worldwide adoption hit an all-time high of nearly 24% in June 2018 according to Google user stats. This reflects a nearly 2 percentage point increase since January, which is slightly slower than the rate of progress made during the same time period over the last 3 years, where adoption rates grew closer to 2-3 percentage points in the first half of each year.

By the end of Q2 2018, user connectivity was ranging from around 20% to 21.5% during weekdays to an average of 23.75% during weekends. Across the globe, a handful of major network operators continue to make excellent progress in broadening their deployment of IPv6. For example, T-Mobile shows IPv6 deployment based on overall traffic volume in excess of 90%, Reliance Jio is closing in on 90% and Verizon Wireless and Sky Broadcasting are clocking it at 85% deployment (see http://www.worldipv6launch.org/measurements/). According to Alexa Top 1000 statistics, however, there has been little progress in the number of websites reachable over IPv6. This time last year around 25% of websites were reachable over v6. At the end of June, this number hadn't changed.

As in the past, there is no evidence that IPv6 is coming close to replacing IPv4 as the dominant protocol for Internet routing or that IPv6 deployment has had any adverse impact on the IPv4 market. At one point it appeared that the market shortage of large block IPv4 address space may accelerate v6 migration, but given the recent influx of large block supply, this seems unlikely — at least for the foreseeable future.